All the electric and hybrid cars that are in the works will need rechargeable batteries to run on. And the market for producing them sees nothing but growth for a long way down the road.

By Jim Jubak

It's 1967. In "The Graduate," the experienced Mr. McGuire leans over to whisper advice to the inexperienced Benjamin (played by a young Dustin Hoffman).

"I just want to say one word to you. Just one word."

"Yes, sir," replies the polite Benjamin.

"Are you listening?"

"Yes, I am," Benjamin assures him.

"Plastics."

"Exactly how do you mean?"

Write that same scene today and McGuire would whisper "Batteries." Especially if he were a savvy investor who followed the trends in the global auto industry.

You've undoubtedly read the stories about General Motors' (MTLQQ) electric car, the Chevrolet Volt, scheduled to go on sale in 2010. That car -- with its $40,000 price tag and GM's claims of 230 miles per gallon -- is either a gimmick designed to convince the U.S. consumer and the Obama administration that the company has turned over a new leaf or a portent of how much things are changing in Detroit.

Whichever it is, the Volt is only one drop in a wave of hybrid electric and plug-in electric cars that is going to wash over the global auto market in the next two decades. In June 2008, Deutsche Bank counted 75 new hybrid electric models set for sale by 2011. And the number has only gone up since then. The National Highway Traffic Safety Administration projects that hybrid cars could take as much as 20% of the U.S. auto market by 2015, up from just 2% in 2007. In Europe, according to marketing company J.D. Power, hybrids and electric cars could account for 50% of the market by 2015, up from 2% in 2007.

And every one of those hybrid and electric cars will need a rechargeable battery. Most of those new batteries will be lithium ion batteries. The automotive market for lithium ion batteries is close to zilch today. Hybrids such as Toyota's Prius run on older nickel metal hydride battery technology. (Conventional car batteries use a lead-based technology.) But lithium ion technology, with its lighter weight and greater ability to stand up to recharging after being completely discharged, is the likely technology of the future.From just about zero now, Deutsche Bank estimates that the automotive market for lithium ion batteries will hit $10 billion to $15 billion in sales by 2010. (The entire market for lithium batteries in things like rechargeable phones and laptop computers was $7 billion in 2007.) By 2020, when the bank projects that lithium ion technology would have just about completely replaced nickel metal hydride technology in cars, the automotive market for lithium ion batteries could reach $30 billion to $40 billion annually.

But just how do you invest in this coming wave of automotive lithium ion batteries? All up and down the battery food chain, that's how -- from the companies that mine lithium to the companies that make the key pieces that form the guts of the batteries, to the battery makers themselves.

The Obama administration is pumping money into batteries, too. For a list of some of the companies that divvied up the first $2.4 billion in government money, see my blog update.

Option 1: The miners
The vast majority of lithium now comes from salt lakes in Chile (about 65%), Argentina and Nevada, and from mines in China.

But that's changing quickly. The global demand for lithium is projected to grow from about 11,000 metric tons in 2012, according to Deutsche Bank, to almost 90,000 metric tons in 2020. Getting to anything like that figure is going to require a huge increase in supply. (It takes about 6 pounds of lithium to make a car battery.)

Big increases in supply look like they'll come from China and (maybe) Bolivia. Both countries have announced plans for new production from salt lakes.

The roster of publicly traded lithium producers is pretty small. The two I'd concentrate on are:

Sociedad QuÃƒÂ­mica y Minera de Chile (SQM). The company produces about 65% of the lithium that comes out of the Salar de Atacama region of Chile. Recoverable reserves there make up 20% of the world's known reserves.

FMC (FMC). The company produces lithium from Argentina's Salar de Hombre Muerto region, where recoverable reserves are estimated at 11% of global known reserves.

Option 2: Companies that make battery guts
My preference here is a specialty chemical company called Polypore International (PPO). In these batteries, during discharge lithium ions travel from one electrode, the anode, to another, the cathode, through an electrolyte and a membrane separator. Polypore makes membrane separators for lead acid and lithium ion batteries. The company's energy storage segment accounted for 71% of sales in 2007, with lead acid separators making up 55% and lithium ion separators 16%. (I'm using 2007 figures here because it was the last normal year before the economy went into free fall.)

Japan's Asahi Kasei (AHKSF) is another big player in battery membrane separators.

Option 3: The battery makers
Technology is important here. Lithium ion technology is still changing as companies try to make the batteries safer, more reliable and, perhaps most importantly, cheaper. Lithium battery makers are trying a variety of technologies to prevent what's called thermal runaway. In a collision, a lithium battery could catch fire as the chemical reaction that normally generates electricity instead generates excessive heat. In addition, lithium ion batteries aren't very reliable at very low or very high temperatures.

Research into all three problems has concentrated on finding ways to make the electrodes more stable and more powerful, and on re-engineering the cells of the battery to add more effective separators that prevent fires.

I'd call A123 Systems the current technology leader. The company's lithium iron phosphate cathodes seem like they solve many of the safety issues, and since iron phosphate is so much cheaper than the manganese, cobalt and other materials demanded by competing battery technologies, I think the company has a leg up on cost as well.

Unfortunately, A123 is still a private company. And still very much at the startup stage.

That means you can't buy into it before its much-anticipated (but still unscheduled) initial public offering. The company first filed for an IPO with the Securities and Exchange Commission in 2008 and filed a fourth revision to that offering in June.It also means that A123 is a small company with small revenue swimming with some very big fish, including the battery divisions of Toyota Motor (TM, news, msgs), Panasonic (PC, news, msgs) and Toshiba (TOSBF, news, msgs). Most of those big-fish companies have too many fish to fry to make them attractive to me as battery plays, however.

Best bet: Buy the manufacturer
But technology is only part of the game. The car battery market is one with huge production volumes where manufacturing smarts count as much as technology. To succeed, a company has not only to build a better mousetrap but produce a lot of them at the lowest possible cost.

Nobody does that better than Johnson Controls (JCI).

The company owns about 35% of the global market for lead acid car batteries. And it's shown its experience in cost control during the auto industry's recent meltdown by taking so many costs out of its business that it managed to swing to positive earnings of 27 cents a share in its fiscal third quarter -- after two straight quarters of losses -- while recording revenue that was down $2.9 billion from the third quarter of fiscal 2008.

The company filled a large part of its technology gap by creating a joint venture with Saft Groupe (SGPEF), a French battery maker with substantial experience in making nickel hydride and lithium ion batteries for industrial and transportation customers. (The deal gradually will give Johnson Controls a bigger and bigger share of the joint venture as it puts in capital.)

Advanced lead battery technologies look like they'll extend the life of Johnson Controls' business in that segment, too. In Europe, advanced valve-regulated lead acid batteries look like an especially promising technology for what are called micro-hybrids, which offer efficiency gains of 10% or so without adding much to the purchase price of a car.

Which one to buy now? The potential payoff is big enough and far enough away so that I think you can add one (or more) of these to your portfolio now without worrying too much about temporary market gyrations. (As long as you can hold patiently.)

My choice here would be Johnson Controls, and I'm adding it to my Jubak's Picks portfolio with this column. I'll spell out the reasons for that pick in somewhat greater detail in an entry that you can find on MSN Money's Top Stocks blog.

At the time of publication, Jim Jubak owned shares of the following company mentioned in this column: Johnson Controls.

Jim Jubak has been writing Jubak's Journal and tracking the performance of his market-beating Jubak's Picks portfolio since 1997 on MSN Money. He is the author of a new book, "The Jubak Picks," and writer of the Jubak Picks blog. He's also the senior markets editor at MoneyShow.com.

Then there is that mysterious company EEStor,
Since the (stolen alien technology) uber capacitors don't use lithium, if their stuff is real then Li is not something to invest in. Supposedly, they will show their production 52 KW/h capacitor pack by the end of the month and give all the details.
The end of September date for EEStor depends on many factors such as, wind, lunar position, position of Pluto relative to Uranus and if the cool stickers for the ceramic pack have been completed. It would kind of be a pain if the EESU system actually works right after you invested in a lithium mining company.

I'll guess that EVen if EEStor pulls through, most will be running on Lithium and Nickel for some time to come...
From here:http://www.tradingmarkets.com/.site/new ... s/2394197/
"Jun 27, 2009 (SmarTrend(R) Spotlight via COMTEX) -- SmarTrend's proprietary algorithms detected bullish price action on shares of Polypore International (NYSE:PPO) which generated an Uptrend alert on April 02, 2009 at $5.26. Since the alert, PPO has trended 104.9% higher as of today's recent price of $10.78."

(Today at $12.44)
Tks
LOcK

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I've been trying for yrs to figure where the batt market is aiming.Short term I think supercapacitor/wlead acid combo(one unit)will be strong.I follow where the DOD goes and this is it.They will wait for lithium to improve and weed out the weak for ten yrs or so,meanwhile puttingmoney in the caps.Doe kicked in big also but the military has huge funds that are not reported.Johnson controls is a fave of the military.there are many that lay low and come across as suppling batts for humvees aircraft and naval needs,many still researching lead acid along w/zinc and other chems.That firm from chili you merntioned has all kinds of connects to the old school military vendors.BYD of china is a factor in the non military sense.One of Buffets side companys bought 10% last year.It's already tripled its value.Lots of players,but not all of the technologies will survive.some will lose because of politics, expediency or just didn't toot their horn loud enough.I won't live long enough to see what wins out but its still fun watching.

p.s. I made 7g's on 1g on cray in less than three mo's this spring.(just buying local)seymour's home town chippewa falls is where I live.So a volatile batt market ain't the only game.the military buys big in super comps.

If EEstor releases a product, almost any product at all, then all EV battery technology just becomes obsolete relics.

Magnitudes lighter, magnitudes smaller, magnitudes more energy, and magnitudes more cycle life than the best batteries have to offer.

IMHO- It's the crashing time for battery stock. Yes, they will still saturate the consumer electronics market for a while longer before EEstor starts making some ultra light, ultra small laptop batteries that give us 5-10x the runtime we've been getting with lithium. I think batteries will be dead soon. At least I very very much hope so! Because batteries have been the giant weak-link that holds us back from EV's replacing ICE vehicles.

Each carcinogen vapor exposure includes a dice roll for cancer.

Each mutagen vapor exposure includes a dice roll for reproductive genetic defects in your children.

Each engine start sprays them into a shared atmosphere which includes beings not offered an opportunity to consent accepting these cancer experiences and defective genetics life experiences.

Every post is a free gift to the collective of minds composing the living bleeding edge of LEV development on our spaceship.

Coupla snips:
"Indications are that the price per tonne was about $50 (U.S.) in mid-2005. It blasted to more than $80 in early 2008 then collapsed like everything else. Today, a tonne changes hands for about $30. It's probably heading higher. But how much?
To answer you have to ask yourself how much you believe in electric cars."

"Lithium was a big breakthrough but it also has drawbacks as used now. Some battery makers are experimenting with adding vanadium into the battery ingredient. Using vanadium, in theory, adds power among other things. It's more expensive than some alternatives but the performance appears to compensate for the added cost.
There are, in fact, strong signs that vanadium is about to make its grand debut in battery technology. China's BYD, which is backed by Warren Buffett, is among the leading-edge battery makers looking at vanadium and is building a plant in the vanadium-producing region of China.
Subaru, meanwhile, has a prototype, the G4e, which will use a lithium-vanadium-phosphate battery. It has twice the range of a prior prototype."

Tks
Lock

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A new technology to prevent lithium-ion batteries from catching fire or exploding in laptops and mobile phones may be on the market as soon as the first quarter of 2010, its inventor said on Wednesday.

The invention, called Stoba, was developed at the Industrial Technology Research Institute (ITRI), Taiwan's national research organization.

When lithium-ion batteries develop internal shorts they can quickly heat up to as much as 500 degrees centigrade (932 degrees Fahrenheit) and catch fire or explode.

Stoba sits between the positive and negative sides of the battery and when the battery hits 130 degrees centigrade (266 degrees Fahrenheit), Stoba transforms from a porous material to a film and shuts down the reaction.

"We have introduced a totally new material to the battery," said Alex Pang, the senior researcher who led a team that developed the new material over four years.

The danger of exploding lithium batteries is so great that last month the U.S. Transportation Department issued a "hazardous materials" notice.

"Many persons who ship lithium batteries do not recognize the hazards... fires in aircraft can result in catastrophic events presenting unique challenges not encountered in other transport modes," the government said.

Pang said battery makers in Taiwan are in the testing stage and have ramped up manufacturing of Stoba-equipped cells to the thousands. They expect to begin shipping in the first quarter of 2010, he said.

Pang, in Orlando, Florida, to get an award, said by phone that Stoba will add only two percent to three percent to the cost of manufacture. He said he wants to try selling the technology to major laptop and phone manufacturers.

ITRI has applied for 29 patents in the United States, Taiwan, Korea, China and Japan for Stoba. ITRI holds 9,863 patents and has 5,800 employees, including 1,112 with doctorates. It has created 151 start-ups and spin-offs.

Must drive my electric car down to New Brunswick some day... visit the Welsford Peralkaline Intrusion... or at least what'll be left after it has been strip mined to make the batteries for my electric car

Lookin' still pretty pristine these daze, only `bout 20kms north of St.John:

Dunno if reading that makes yer palms sweaty but with the new interest in non-China Rare Earths it makes folks like Cache Exploration Inc. go gaga and start to buy up the whole neighbourhood...
Cache site here:http://www.cacheexploration.com/

Petrogeochemical studies (Seidler et al., 2005) have verified up to 18,500 ppm Zr, 1,710 ppm Nb, 1,713 ppm Y, 153 ppm U, 446 ppm Th, 1,268 ppm Ce, and 198 ppm Yb as the average from random grab samples taken from the McKeel Lake dykes, which will be a priority target on these claims. Grab samples can be selective in nature and may not reflect the average grade on the property. These represent concentrations comparable to those found in the richest heavy REE deposits in the world. In the fall of 2009, Dr. David Lentz, Economic Geology Chair at the University of New Brunswick, coordinated and oversaw the surficial B horizon soil sampling and analytical program over the Welsford properties; the instrumental neutron activation analytical results of this program revealed many highly anomalous soil samples with high Lanthanum (La), Cerium (Ce) and Neodymium (Nd), followed by Samarium (Sm), Europium (Eu), Terbium (Tb), Ytterbium (Yb) and Tantalum (Ta).

Cache's geological team, directed by Dr. David Lentz, will be completing a second phase exploration program during 2010 that will include further ground stream sediment and soil sampling, prospecting and geological mapping, followed by trenching and drill testing to confirm historical results and search for undiscovered new zones of REE mineralization. The Company intends to split and re-assay historical drill core by specialized methods for determining REE results.

I have no interest or share ownership in Cache (yet)
Cheers
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liveforphysics wrote:If EEstor releases a product, almost any product at all, then all EV battery technology just becomes obsolete relics.

Magnitudes lighter, magnitudes smaller, magnitudes more energy, and magnitudes more cycle life than the best batteries have to offer.

IMHO- It's the crashing time for battery stock. Yes, they will still saturate the consumer electronics market for a while longer before EEstor starts making some ultra light, ultra small laptop batteries that give us 5-10x the runtime we've been getting with lithium. I think batteries will be dead soon. At least I very very much hope so! Because batteries have been the giant weak-link that holds us back from EV's replacing ICE vehicles.

I don't know about eestor, but I think that the battery market probably will go in a new unexpected direction as big money is funneled into it. Lithium might make you some money, but its something else that'll hit the jackpot.

Snips from their pages:
The company is developing high efficiency, dual-power microturbines and high-voltage lithium ion batteries.

Gram for gram, ETVMÃ¢â‚¬â„¢s lithium-based cells deliver 50% more energy than the best competing cells. Batteries built from these cells will be smaller, more affordable, and have potentially twice the driving range of other lithium-ion batteries.

Advanced Battery: High-Voltage Spinel Li-Ion Cathode

While the characteristics of the LiCoO2/Graphite electrochemical system are acceptable for the portable electronics market, significant improvements in the safety and lifetime of lithium-ion must be achieved in order for large-scale lithium-ion batteries to become a viable solution for vehicle propulsion.
At this time, the LiFePO4/Graphite electrochemical couple offers the most promise, as it provides beneficial power, safety and cycle life over the most mature cobalt-based systems.

Although LiFePO4 has many advantages, it suffers from low potential (3.45V vs. Li+/Li), and low material density (3.6 g cmÃ¢Ë†â€™3). Batteries based on this cathode have relatively low energy-density - approximately 50% that of the cobalt-based system.
New battery systems that have the positive attributes of the LiCoO2 and the LiFePO4 systems, while overcoming their respective deficits, are in great demand.
High voltage spinel oxides are promising candidates. This type of cathode chemistry has been studied for a number of years. However, the high voltage has the following detrimental effects, which have thwarted its implementation in commercial batteries:
Oxidation of the electrolyte solvent - results in the damage of the anode and cathode SEI structures, mechanical blockage of electrode active sites and parasitic reactions.

PPM concentrations of HF due to residual moisture in the electrolyte - results in partial dissolution of metal ions in the cathode and damage of the anode and cathode SEI structures.

To address these problems and develop a revolutionary lithium-ion battery, ETV Motors has assembled a battery R&D team with a proven track record in developing disruptive electro-chemistries that have reached the commercial marketplace. This expertise spans primary and rechargeable batteries and ultra-capacitors. The research is being done in collaboration with the world-renowned electro-chemistry team at Bar Ilan University.
The joint research team is developing a 4.7V Lithium Manganese Nickel Oxide (LMNS) cathode that overcomes the problems experienced by other researchers to date.

The proprietary and patent pending solutions demonstrated in the laboratory involve the following strategies:
Ex-situ nano-scale coating of the LMNS raw materials
Novel LMNS synthesis process

In-situ coating of cathode with nanometric polymeric layers
The resultant LMNS cathode may be coupled with a range of anodes. ETV is working on two cell chemistries: LMNS/Graphite to form a 4.7V cell; and LMNS/LiTiO to form a 3.2V cell.
While the LMNS/Graphite couple has the potential of superior characteristics due to its higher voltage, it may prove advantageous to pursue the lower voltage LMNS/LiTiO couple as it has demonstrated the ability to provide a long cycle life and very high power relative to the graphite anode.

The following Ragone plot charts the expected position of the ETV 4.7V and 3.2V cathode chemistries relative to the commercial Lithium-ion chemistries.

The present focus of the companyÃ¢â‚¬â„¢s research and development is to demonstrate that the problems associated with 5V spinal cathodes have been overcome.
In parallel, over 200 cycles have been obtained with our 5V cathodes (with both anode types) under a range of conditions.

ETVM raised a milestone-driven $12M investment in 2008, led by The Quercus Trust. New York-based 21 Ventures, LLC, a venture capital firm concentrating on the technologies set to dominate the 21st century, is a co-investor.

If we knew what it was we were doing, it would not be called research, would it? Albert Einstein
A paranoid is someone who has SOME idea of what's going on. Allen Ginsberg(?)
If the greatest pleasure is giving, be selfish - give pleasure.

If we knew what it was we were doing, it would not be called research, would it? Albert Einstein
A paranoid is someone who has SOME idea of what's going on. Allen Ginsberg(?)
If the greatest pleasure is giving, be selfish - give pleasure.

Yah yah... Look at us! We have Vanadium!... and also lately a little lithium and rare earth properties... Can't say I'm excited with their recent move into nickel with China nickel pig iron kinda kickin' the traditional nickel folks in the teeth but really Prophecy looks like mostly about selling Mongolian thermal coal to the Chinese... Which is looking like not a bad plan with recent prices for thermal coal. Prophecy doesn't look too Li battery-oriented really. Long term maybe.
LocK

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